BPS closure hits bankruptcy claim against Semen Cibinong

JAKARTA (JP): The Central Jakarta Commercial Court postponed on Monday the first hearing of a bankruptcy claim filed by Bank Papan Sejahtera (BPS) against PT Semen Cibinong due to the uncertainty over the legal status of the newly-closed bank.

"I will consult with the central bank and an expert familiar with bank closures about Bank Papan's legal status. We have to continue this hearing tomorrow (Mar. 16)," Judge Haryono told the court in Monday's hearing.

Hotman Paris Hutapea, Semen Cibinong's lawyer, questioned the legal status of Bank Papan after it was included in the list of closed banks announced by the government on Saturday.

"Bank Papan is closed. How can a non-existent entity file a bankruptcy claim against Semen Cibinong?" Hotman asked the judge at the hearing.

According to a Bank Papan lawyer, Lucas, Bank Papan has not yet been liquidated, so that it is still an existing entity.

"Even though Bank Papan's business license has been revoked, the bank is still operating as an entity. In fact, the bank's operating license issued by the central bank is still valid," Lucas added.

Bank Papan, one of 38 banks closed by the government on Saturday, filed a bankruptcy petition against Semen Cibinong with the court last week for the company's failure to settle loans amounting to $8.6 million which became due between June 30 and Oct. 1 last year.

Bank Papan said it had sent a number of warning letters to Semen Cibinong, controlled by businessman Hashim S. Djojohadikusumo through his Tirtamas Group but the warnings were ignored.

Hotman, however, said that Semen Cibinong had no longer had any bank loan outstanding with Bank Papan since January.

"Semen Cibinong's bank loan with Bank Papan was converted into bonds in January 1999. And these bonds have not matured yet. So, there is no overdue cash payment on which to base Bank Papan's bankruptcy claim against my client," Hotman said.

On the contrary, Lucas said that the bank loan had never been converted into bonds.

Lucas acknowledged that there was a new agreement in January with Semen Cibinong but such a deal should not be interpreted as converting Semen Cibinong's bank loan into bonds.

Semen Cibinong still therefore has an outstanding debt amounting to $8.6 million to Bank Papan, he said.

The second hearing of Bank Papan's bankruptcy claim which will be held on Tuesday is to decide the legal status of Bank Papan and the status of Semen Cibinong's debt, and whether the latter is still a bank loan or has become bonds.

The commercial court's presiding judge has instructed both prosecutor and defendant to present a written argument about the debt's status.

Semen Cibinong's debt to Bank Papan is part of its total debts of US$1.1 billion to more than 60 creditors, according to the company's spokesman Jannus Hutapea.

He added that Semen Cibinong is at the final stage of the negotiations with creditors to draw up a debt restructuring plan. (02)